Marriage Allowance – Are you entitled? What you need to know!
Marriage allowance allows you to transfer up to £1,060 of your personal allowance to your husband, wife or civil partner.
By adding this to their personal allowance, this will mean that they’ll pay £212 less tax in the tax year.
It was the government’s intention to give a tax allowance to married couples and civil partners as a way to balance the negative tax implications when only one person works.
The legislation permits up to 10% of a spouse’s or civil partner’s unused personal allowance to be transferred. This is conditional on:
- neither spouse nor civil partner paying tax at the higher rate, so having an income of up to £42,385;
- the transferor having some unused personal allowance; and
- neither spouse nor civil partner making a claim for the married couple’s allowance (which applies when one of the couple is born before 6 April 1935).
How much tax you’ll both play
By claiming Marriage Allowance:
- your partner’s Personal Allowance increases to £11,660 – they’ll pay £212 less tax
- your Personal Allowance goes down to £9,540 – you won’t pay any tax if your income’s less than this
CLICK HERE to calculate how much tax you’ll pay as a couple.
How to apply
You can apply for Marriage Allowance online here.
How your personal allowance will change
HM Revenue and Customs (HMRC) will give your partner their extra allowance either:
- by changing their tax code, usually to 1166M – this can take up to 2 months
- when they send their Self Assessment tax return, if they’re self-employed
Your tax code will also change if you’re employed or get a pension. Your new code will reflect your new Personal Allowance and will end with ‘N’.
CLICK HERE for more information on this over on the Governments website.